After documents divulged a list of lender-provided aperitifs and barbecues for staff at UT's Office of Student Financial Services, UT President William Powers said that until the UT System completes its investigation into the office, the staff better not even go to lunch - with lenders, that is.
Student Financial Services Assistant Director Don Davis said gifts and treats mean little, especially to those who decide which lenders get preference on UT's lender list, although Powers said they ought not to be accepting gifts at all.
"We are ensuring, during the investigation, that decisions are not being made by people who are influenced inappropriately," Powers said.
Documents obtained by an open records request on Friday showed that the financial aid office had accepted gifts including pizza and lasagna lunches, happy hours and ice cream carts from its preferred lenders.
"Gifts were a minor contribution that the recipients on staff who made decisions didn't even know who gave what, or care," Davis said.
UT System Vice Chancellor and General Counsel Barry Burgdorf said his investigation will look into gifts and relationships between lenders and financial aid officers.
Burgdorf said he will issue a draft report to Powers and the UT System Board of Regents next week.
One set of documents titled "lender list analysis" included "OSFS visibility" as a categorical measurement "based on the number of lunches, breakfasts and extracurricular functions for entire OSFS staff."
"Frankly, we didn't really care much about it and didn't really pay any attention to it, to be honest with you," Davis said.
Samuel Riley, former accounting and loans supervisor at the financial aid office, said he created the analysis, which he said included the "visibility" category, because lenders asked that he include it in the document.
"Lenders did not get an up close and personal view," Riley said. "There were stressful times when they wanted to know, when I first started, how [Associate Vice President of Student Financial Services Lawrence Burt] made his choices, and I wanted to create something to let them know this is what we keep track of."
Riley's ranking also included factors that had not been categorically defined in previous analyses, such as volume rank, customer service, consolidated loans and zero or reduced fees.
Though Riley said "visibility" was an insignificant part of the analysis, he said he's not familiar with how the actual selection process was conducted.
"I was not involved with the selection process," he said.
Documents show that Riley occasionally changed lenders' rankings up or down on preferred lender lists at the request of Burt, with little to no explanation of such actions. Riley did not wish to comment on those e-mails.
Davis said preferred-lender-list decisions take into account the prevalence of a lender on a regional or national scale. Companies much smaller than Wells Fargo, Bank of America or Citibank sometimes have poor communication with the financial aid office.
It's an intuitive process, Davis said.
"We had 20 people on our list already, and we didn't need to add people unless we saw something that was a totally wonderful product," he said. "We weren't necessarily looking for new products."
In terms of a lender's availability for questions and concerns, updates and product exposure, smaller players just don't have a lot of presence, he said.
"If they don't express an interest, you're probably not going to consider them for your list," Davis said. "Unless you know who they are they talk to you, and they exhibit their product, and they say this is what we're doing, you don't even consider them."
The New York attorney general's office began investigating the University's financial aid office early this month after records revealed that Burt owned stock in the parent company of one of the University's preferred lenders. UT is just one of several universities nationwide that have been included in New York Attorney General Andrew Cuomo's investigation of the $85-billion-per-year student loan industry.
As part of the investigation, the UT System ordered all of its academic and health institutions to remove their preferred lender lists from their Web sites on April 16.
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